Clinics, tech, physician practices acquisitions to outpace hospital deals, Accenture report says
Accenture forecasts that only 8 percent of deals between 2015 and 2018 will be hospital related, while 84 percent will be for non-acute providers.
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Healthcare mergers are much more intricate in the post-reform world, as systems are more apt to buy clinics, physician practices and digital tools than hospitals, a new report by Accenture claims. So far, healthcare providers booked $241 billion in deals in the first five months of 2015.
According to the consulting company, the drive towards economies of scale, population health and value-based reimbursement has caused dealmaking to surge since 2006. But the targets have shifted.
[Also: Tracking 2015 mergers and acquisitions]
From 2006 to 2010, 32 percent of deals were related to hospitals, while 64 percent were related to non-acute providers like clinics and physician practices. At the same time, only 1 percent of deals were linked to digital tools.
From 2011 to 2014, 21 percent of deals were for hospitals, 74 percent were tied to non-acute services and 1 percent were tied to digital tools.
As that trend progresses, Accenture forecasts that only 8 percent of deals between 2015 and 2018 will be hospital related, while 84 percent will be for non-acute providers and 8 percent for digital tools.
So far, 2015 has already seen a few moves by health systems to buy up tech tools. Northwell Health, formerly called the North Shore-Long Island Jewish Health System, recently formed a joint venture with Newport Health Solutions to take on their population health platform. Partners HealthCare also formed a joint venture with Health Catalyst for their population health technology.
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"To deal effectively with greater complexity, higher volumes and other changes resulting from increased acquisitions, industry providers will need to manage their businesses with the mindset of a portfolio manager," said Kristin Ficery, managing director of health provider consulting at Accenture, in a statement. "Rather than viewing deals as one-off opportunities, the best-prepared executives will systematically manage a potential deal as a product of the whole."
Accenture said it expects health systems to buy up health companies that focus on sensors, mobility, analytics or cloud services in the next few years.
Accenture analyzed more than 1,500 healthcare acquisitions since 2006 for the report.
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